The Macro-Economic Effect of Codetermination on Income Equality

24 Pages Posted: 11 Dec 2012

See all articles by Felix Hörisch

Felix Hörisch

Heidelberg University - Institute for Political Science; University of Mannheim - Mannheim Centre for European Social Research (MZES)

Date Written: December 10, 2012

Abstract

Many studies on the effect of codetermination at company-level reveal its significant influence on wage levels within companies. However, does this effect at the micro-level result in higher income equality at the macro-level as well?

A cross-sectional regression analysis of data on EU and OECD countries will be used to test for the codetermination’s effect on income distribution. Assessing the impact of codetermination, a new index on codetermination strength will be introduced, combining the scope of codetermination rights with the threshold of codetermination laws. The results suggest a significant negative impact on the Gini index which indicates that codetermination rights lead to higher income equality.

Suggested Citation

Hörisch, Felix, The Macro-Economic Effect of Codetermination on Income Equality (December 10, 2012). Available at SSRN: https://ssrn.com/abstract=2187264 or http://dx.doi.org/10.2139/ssrn.2187264

Felix Hörisch (Contact Author)

Heidelberg University - Institute for Political Science ( email )

University of Mannheim - Mannheim Centre for European Social Research (MZES) ( email )

D-68131 Mannheim
Germany

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